Despite Gulf Leak, World Still Wants Deepwater Oil

With crude still hemorrhaging into the Gulf of Mexico, deep-water drilling might seem taboo just now. In fact, extreme oil will likely be the new normal. Despite the gulf tragedy, the quest for oil and gas in the most difficult places on the planet is just getting underway. Prospecting proceeds apace in the ultra-deepwater reserves off the coasts of Ghana and Nigeria, the sulfur-laden depths of the Black Sea, and the tar sands of Venezuela’s Orinoco Basin. Brazil’s Petrobras, which already controls a quarter of global deepwater operations, is just starting to plumb its 9 to 15 billion barrels of proven reserves buried some four miles below the Atlantic.

The reason is simple: after a century and a half of breakneck oil prospecting, the easy stuff is history. Blistering growth in emerging nations has turned the power grid upside down. India and China will consume 28 percent of global energy by 2030, triple the juice they required in 1990. China is set to overtake the U.S. in energy consumption by 2014. And now that the Great Recession is easing, the earth’s hoard of conventional oil is waning even faster. The International Energy Agency reckons the world will need to find 65 million additional barrels a day by 2030. If the U.S. offshore-drilling moratorium drags on, look for idled rigs heading to other shores.